Reply to Car Lease - 45K car

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[quote=Anonymous]We have leased cars on multiple occasions.

There is no pat answer as to whether it is better to lease than to buy. As a general rule if you are going to keep a car for many years it probably makes more sense to buy. But that is not always the case because even when you lease you can still buy the car at the end of the lease. So you would have relatively low payments during the lease term and then can exercise the option to buy the car at the end of the term.

The factors that go into whether a lease would make sense is the capitalized cost - what you are paying for the vehicle - the money factor (in other words the interest rate) and the residual percentage that is a percentage of the MSRP. Dealers usually play around with the cap cost, the money factor and sometimes options that they try to add to the cost. They may also try and jack up the acquisition fee (bank fee) and dealer processing.

Those who say that leasing is always a mistake are just plain wrong. It is as ludicrous as saying that buying a house is always better than renting one.[/quote]

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